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NUCAFE: National Union of Coffee Agribusinesses and Farm Enterprises

On 21st May 2020, the Government of Uganda represented by the Ministry of Trade Industry and Cooperatives, Makerere University and Uganda Revenue Authority (URA) along with the United Nations Capital Development Fund (UNCDF) launched the Uganda Business Impact Survey 2020. The report, which incorporates responses from over 1,000 firms, demonstrates the impact of COVID-19 on small and medium enterprises (SMEs) in Uganda. The report also makes recommendations on how local businesses can be supported to relieve them of the negative effects of the pandemic and accelerate economic recovery.

The report is being published at a time when Uganda has moved to ease the lockdown restrictions by allowing a few businesses to reopen subject to government delivering face masks. The country has been in a lockdown for over 45 days and only businesses providing essential services such as food markets and grocery shops remained open. Since the nationwide lockdown commenced, business operations have significantly slowed down.
Insights from the survey show that:

• The downward pressure of declining production due to a reduced workforce and slowing demand has forced companies to look for ways to reduce their operating expenses including labour. 62.3 percent of the respondent companies are considering or have already started cutting jobs.
• Ugandan companies are fragile and have a relatively low cash flow. Only about 15 percent of surveyed companies can sustain more than three months of operation on their current cash flow.
• Some industries expect an increase of over 30 percent in the cost of inputs and operating costs. These include manufacturing, production and payment of utilities (electricity, heat, gas and water), where 45 percent of companies expect an increase of more than 10 percent.
• Use of digital solutions is the most popular adaptation measure yet uptake is low with only 40 percent of all companies using online channels.

The report highlights how the pandemic has not only affected business operations during the lockdown period but will continue to affect operations even when the lockdown is lifted. Recovery for most businesses is expected to take more than three months and possibly until the end of the year. 70 percent of the respondent businesses estimate a recovery time of more than three months.

While presenting the report, Head of UNCDF in Uganda Office Dmitry Pozhidaev urged business owners to be innovative, “by definition a business involves risks and not all risks can and should be covered by government, businesses need to innovate to stay afloat.”

Some sectors like the tourism industry, which started slowing down in January and all but stopped in early February, does not expect to recover until over a year from now, bringing full recovery to sometime next year.  Building on the projected recovery expectations, the report provides recommendations to support business recovery and survival.

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Time consumed

Start:
28-Dec-16
End:
28-May-19

Lead Nordic partner

NIRAS A/S

Country of Lead Nordic partner

Denmark

Local partner(s)

National Union of Coffee Agribusinesses and Farm Enterprises Ltd (NUCAFE)

NCF grant size

499,886

Total project cost

1,028,378

Technologies

Solar photovoltaic systems

Methods

Agroforestry, Training, Value chain development

Description

The project aims to create a climate change resilient coffee value chain in Uganda through the implementation of the farmer ownership model as well as investing in several mitigation and adaptation measures.

Earlier this month (June 2019), NUCAFE welcomed and hosted GSBI friends from Santa Clara University- California,USA.

The fellowship program will benefit NUCAFE for the work they will be doing here and also build or add a stone to their careers.

 

A digital farmer profiling initiative, which enables coffee to be traced back to its roots, is paying off for smallholder farmers in Uganda. NUCAFE’s David Muwonge describes how coffee produced under the scheme is fetching far higher prices, revealing the strong potential of geo-referencing as a marketing tool to guarantee authenticity and origin.

I grew up on a coffee farm in Uganda, where I witnessed how much my parents had to toil to make money from coffee to pay school fees for my siblings and me. Known nationally as the main cash crop and foreign exchange earner in Uganda, coffee farming provided my family and others like it with far less than 5 percent of the retail value of coffee – less than US$1 a day –  perpetuating generational abject poverty.

Hope for Rural Wealth Creation